Pay attention to the Indian startup scene | Hacker News Reader

Pay attention to the Indian startup scene

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103 pointskumaranvpl76 comments

I hope investors put more money in India in medtech, biotech, Pharma and Agritech instead of this current trend of investing in worthless consumer startups. India is much more stronger in biotech and Pharma than IT which is primarily a outsourcing work based on human labour cost arbitrage.

Indian eco-system is very complex and many of the figures are made up for investment by startups without any means of verification. Given cost of acquiring users in India is very very low, getting large users to show traction even for a mediocre or fake product is easy.

India leads the IT outsourcing industry which offer manpower as a product to support a legacy system or software on which most developers in developed nations don’t want to work as there isn’t a big future in it. Most famous Indian IT companies are mostly Human Resource Management company optimised for cost arbitrage between the salary in India vs US (and other developed places). Most IT firms processes are made around mandays (already a gender biased term), to make sure salary paid is 1/5th to 1/6th of the overall revenue this person generates from customer.

Except few, most startups are get rich quick schemes in India in which founder takes the money and there isn’t any recourse for investors given the rule of law takes ages to have results examples like Oyo and BYJU are everywhere.

> India is much more stronger in biotech and Pharma than IT

Interesting. I'd like to see a citation.

India ignores other countries patents on medical things. Not sure what the legal justification is, but the actual justification is obvious.

Yes, we all know it, but this is the only thing I know about biotech and Pharma in India. It doesn't really tell how "much more stronger" the industry is than IT, which is why I asked for a citation.

Not sure what are you implying, this isn't true India plays by WTO and international rules [1]. It uses provisions enshrined in the bilateral treaty and also the rules of global trade. India still today do not support evergreening of patent's by incremental changes. It only grant patents to original innovations.

If you need more information about it probably read the 1970 patent act [2], in India which started those specific innovations in pharmaceutical formulations and made medicines affordable not just for India, but for most of Africa and many developing countries.

[1] https://www.wto.org/english/tratop_e/dispu_e/cases_e/ds50_e....

[2] http://ipindia.nic.in/writereaddata/Portal/IPOAct/1_31_1_pat...

Sounds like the legal justification.

> India ignores other countries patents on medical things.

And thank goodness for that. Millions upon millions of lives in the developed world have been saved by Indian generics.

> Not sure what the legal justification is

It's a sovereign nation.

India is not alone. Brazil and several other countries have resorted to the same measures.

https://en.wikipedia.org/wiki/Compulsory_license

"Evergreening" isn't a legitimate practice but exist just as tax havens and gambling do.

The US is a very poor example of getting things right in healthcare, the prices of healthcare are inflated to astronomical rates so insurance can make a cool profit.

The price of medicines in the US is a poor scale to use across the world.

Take a look at biocon story how they revolutionized diabetes management [1] and second check this report [2]. If more investments go in this area, India can very well be at par with US/UK and Germany in medtech, pharmaceutical and biotech areas.

[1] https://store.hbr.org/product/oral-insulin-breakthrough-inno...

[2] https://www.semanticscholar.org/paper/Innovations-in-Indian-...

Thanks, just added them to my read list. Looks like a fun read.

> Most famous Indian IT companies are mostly Human Resource Management company optimised for cost arbitrage between the salary in India vs US (and other developed places).

I think you're ignoring the changing tech landscape in India - the same cost arbitrage that allowed IT outsourcing is now being used to build capital efficient tech startups who get much longer runway on the dollar compared to startups in the US or Europe. Of course, finding a Western market for most Indian startups is still very challenging, but I expect this model to become more successful over time.

Don't get fooled by India's startup hype. India has one of the world's "best" anti-business systems that will create hurdles all along the way to the top. If you do get to the top, the same systems will become your ally (as you would have learned to grease those).

Apart from the regular business troubles and risks, the unease of doing (not just starting) business in India is a huge growth barrier. And it is worsening. The bureaucracy is just horrible and spiced with corruption all over from taxation to approvals. The leaders have little control on that. And it may not visible for first 1-3 years of business growth time, it consistently hits and threatens you as you grow further.

Having said that - Any economy focused strong leader in India could flip that view in a matter of 6 months or a year. It might require reducing the bureaucracy resources by 70-75%. Otherwise the country might be selling the same hopes & dreams for next 50 years or more. India has talented resources and is potentially a talent goldmine, but they are mostly hidden, misused, abused, suppressed, unaware or just moved out.

I guess this will attract a lot of downvotes

Something interesting about the startup scene in India is how the center of gravity has shifted over the last 10 years from Bangalore / Hyderabad to New Delhi. Elad Gil's recent post mentions this: http://blog.eladgil.com/2020/10/unicorn-market-cap-industry-... with Bangalore having 8 unicorns vs Delhi's 11.

"While Bangalore continues to thrive, some point to bad governance locally (traffic, high rents, passive government) as one of the reasons it is not the only center. There are undoubtedly other reasons, but it is worth thinking about relative to San Francisco longer term."

> ... Bangalore having 8 unicorns vs Delhi's 11.

How much of that is related to government influence (the effectiveness of pushing Bangalore & Hydrabad to be tech centers)?

I note that Bangalore's population is 8m, while Delhi is 21m. If it was 'unicorns per population' then you'd naively expect a ratio of 8:21, not 8:11.

Delhi has 4 really good engineering schools as well (IIT and IIIT-Delhi are world class, DCE/DTU and NSIT / NSUT have equally smart kids). In my experience they aren't going for big company jobs now but are more geared towards joining smaller firms or starting something of their own. Co-working space is also a big thing there. Transport isn't as bad as Bangalore. Hope the air is better and women's safety increases as well. The food is the best in India - my biased take :)

> Delhi has 4 really good engineering schools as well

IIT has an engineering faculty, but is not 100% eng. That's a common misconception in the US.

It's predominantly known for the JEE and it's engineering program. Yes there are other programs.

Holy crap - I forget sometimes how many people are in India. Compare those two numbers to LA's 4M people and you start to remember how small America is population wise. With the way that tech is going AKA Eyeballs/ads/consumerism equals money, the tech scene in India is going to be much bigger than the US in the future.

From a global viewpoint America is also massive. India and China are just outliers. There are entire nations with smaller populations than some neighborhoods in New York or Los Angeles.

LA is 12MM people (LA county).

Which is not than the population of Belgium[1]

1.https://www.google.com/search?q=population+of+Belgium&oq=pop...

Out of 190+ countries, America is in 3rd place for largest in the world by population with 330MM people. [0]

And if America, overnight, produced 1 billion more people?

It would still be in 3rd place.

[0] https://www.worldometers.info/world-population/population-by...

India will likely tie China in population after the current famine in China - expecting around 200 million casualties in the next year.

Yes, but India's nominal GDP is half that of California; in fact India's GDP per-capita is lower than just about every country in ASEAN and East Asia. The entire country's GDP is similar to that of the Tokyo metropolitan area. The socio-economic indicators are actually more aligned with impoverished African nations.

These are clear indicators of state failure.

True but not sure if you considered Power Purchasing Parity of Indians. India is able to manufacture most of the stuff for itself at the moment and hence everything is cheap in India. From basic things like soda cans that cost 10x less in India than the US to the same online services that also cost 10x less.

The GDP per capita might be less in terms of the US standards but the Power Purchasing Parity makes up for it plus we can't forget that the nominal GDP is still in Top 3/Top 5 in the world ( depends on what source you look at ).

India has a negative trade balance so still need "strong" currency to buy abroad, same thing for its citizens to travel and its companies to expand internationally. The size of the economy is nothing to sneeze at, but in the same way PPP gdp is more important than nominal for the average citizen, per capita is way more important than total GDP, that's the reason anybody would pick to live in the small economies of San Marino, Luxembourg, Monaco o Curacao over India or Nigeria.

You make an interesting point. However, India and Nigeria are starkly different, just food for thought. It's almost like comparing U.S with South Africa.

> However, India and Nigeria are starkly different, just food for thought.

No, they are not. GDP nominal per capita: India: 2000, Nigeria: 2000. GDP PPP per Capita, India: 6000, Nigeria : 5000

> It's almost like comparing U.S with South Africa.

GDP PPP per capita: US: 63000, South Africa: 12000. GDP nominal per Capita, US: 63000, South Africa : 5000

There's massive income disparity in India. Nominal per capita income for the richest state is nearly 9x of the poorest state.

Not an apples to apples comparison - LA metro area has a population of 13 million.

As someone who's never been to India, when someone says "Bangalore" I think "tech hub" and when someone says "New Delhi" I think "Bollywood". Do people feel a pull toward New Delhi the way people feel a pull toward NYC here in the US?

Bollywood == Mumbai

While I can't speak for Delhi, Mumbai is closer to the "NY of India" and attracts young people in the same way

If we are going to compare cities

Mumbai == LA (Film Industries) Delhi == NY (Not much to support this but the Rude people stereotype)

Not really, the financial center of India is Mumbai. Bombay Stock Exchance is in Mumbai, as its name implies. You could say the Wall Street of India is in Mumbai.

Anyway, I'm not sure it would make sense to make these comparisons.

Nah. Mumbai has stock exchanges (BSE and NSE), banks and financial institutions, ports, the TV, music, and fashion industries. It's far more similar to NYC than New Delhi is.

Delhi is DC - capital of the country, lots of politicians and bureaucrats. Also spread out quite a bit and with lots of impressive historical and government buildings.

Mumbai is LA and NYC sort of combined - entertainment capital (Bollywood) and financial capital (main stock exchange, banks, Dalal street (equivalent of Wall Street). Also like NYC, cramped with lots of skyscrapers.

I've been to both Delhi (more accurately, Gurgaon) and Bangalore on business assignments. I don't mean to sound unfairly harsh, but it's difficult for me to imagine a city that basically feels like it's constantly trying to kill you become a center of startup activity, for the simple reason that once one becomes wealthy enough to invest in startups one would want to leave the city for a better quality of life.

The air quality and pollution problems in Delhi are like nothing I have ever experienced. When I was there (granted, it was exceptionally poor air quality even for Delhi at that time) I could not see the sun at midday due to the smog - I couldn't see more than 100 feet due to the smog. I felt like Blade Runner could have been filmed in Gurgaon - a post apocalyptic world with giant buildings but a dire lack of accessible green space. Even if there were much green space, I couldn't spend much time outside because every breath tasted like acrid metal.

I'm not saying San Francisco and Silicon Valley are some utopias either - they obviously have a slew of social ills (often debated on HN). But I have never realized how much I have taken for granted being able to breath clean air, and I really hope Delhi is able to clean up its pollution problems, but until it does I can't see it becoming a truly globally competitive startup center.

I think Elad's point wasn't that Delhi will become a global startup center, but that it became India's startup center from behind since the original leader (Bangalore) suffered from poor governance over the last 15 years.

The parallel to the US could be that, over the next 10-20 years, NYC (or some other new hub) overtakes the Bay Area / SF for similar reasons.

Based on covid mortality, it’s arguable that Silicon Valley is better governed than people give it credit for. Not only has mass death been avoided so far in the Bay Area (compared to the situation in New York metro area earlier this year), California has been battling multiple emergencies during at the same time (see the extraordinary fire season this year)

8 vs 11 is too small a sample size to say either way. It may very well be that a couple of these startups succeeded due to their business model / luck / sector / whatever which wouldn't apply to the next startup.

If it were 0 vs 11, that would mean something, but 8 vs 11 is too close.

Instead of counting unicorns, we should count the number of successful exits, such as acquisitions. Or, second best, the number of companies that reached (say) series C funding.

The current cohort of 20 year olds are educated, smart and building companies or working in startups. If they manage to find good exits in a couple of years, they can become angel investors after that. Thus teenagers of today will be founders of Ant financial of the next decade of India. India today looks like China from 2000-2007.

From an EU perspective, it's mind numbing to see so much growth. If they only followed traffic/parking and had a slightly better electricity and water infrastructure, they would be as good as some countries in EU but with better companies and constantly producing new jobs.

Why wouldn't you just call your representatives and force them to enforce traffic laws in your neighborhoods? You are this close.

I don't know if I can agree. The early startup scene is far less energetic and exciting than it used to be 7-8 years ago. Most of the funding is cornered by mature startups that had their start a decade ago, and are still seeking their first exit.

The good part is that more and more startups are tackling tough industries like insurance. But it does feel like we're past the crest of the wave.

Yeah India tech is awesome and often over looked. They launched 20 some satellite in 2 weeks with very little money.

NASA and Elan you can learn some from the Indians!

https://tribune.com.pk/story/1128048/india-launches-record-2...

Yeah why the down vote? It is interesting to see US/West centric view on stuff like this on hacker news. Fact is other countries are doing stuff better and cheaper in high tech like space tech.

Better and cheaper than NASA and ESA? I highly doubt that.

At this point, anyone is cheaper than Nasa.

104 Nano Satellites in one go

https://economictimes.indiatimes.com/news/science/isro-sends...

I believe it. There's some really slick Indian stuff in the Arduino/Scratch space, and it overcomes the usual English-to-English linguistic pitfalls that tend to make Indian less products unappealing to USA users.

As an Arduino enthusiast who has taught kids using Scratch, I'm interested in this. Can you list some examples?

What is fascinating is that the Indian economy as a whole hasn't been doing too well lately. Verdict is out and you'll read both interpretations but here's one from a Nobel Laureate: https://economictimes.indiatimes.com/news/economy/policy/ind...

The startup activity in India is the bright side of the story. We are still riding the boom that came due to Jio and mass adoption of "data" - but I worry that the overall slowdown in the economy will catch up with the startup ecosystem at some point.

Numbers mean nothing. I give you a million road sweepers and you won't end up with any product at all.

Talent is gravitating towards US - that's an undeniable fact.

I tend to agree, the business climate in India holds back any serious startups with global aspirations. Eventually they come to find ground in the US.

I'd have to disagree. Only partly though. You mentioned a well established phenomenon, brain drain and it's true that the Indian talent gravitates towards the Silicon Valley or for the most part at least tries to but this is the point of the article as well, this phenomenon is slowing down a bit, not as much Indians gravitate with their startups to the US as they did say, a decade ago.

This shows progress and this is what the whole point is, progress.

With the extreme H1B conditions at the moment, it's unlikely people will take extra steps to just get to the US when they can try setting it up in India.

>With the extreme H1B conditions at the moment, it's unlikely people will take extra steps to just get to the US when they can try setting it up in India.

Would those interested in H1Bs but who are struggling to get one not simply go to Canada instead?

Or Europe.

I don't know how many would face this issue but I personally can't live in a place where winters are too cold and too gloomy and too indoor. We are a warm country in general. Even the winters in the plains are pretty open and outdoorsy during daytime.

Why would Europe be an attractive proposition for people leaving India?

Not necessarily. Life in Canada is monetarily not so easy. Tech careers in India are more like America of the 90s. Companies popping up every year, a large bidding ecosystem and yet most population is not even fully super educated.

A tech worker in India can hire someone to come home everyday and cook hot meals while they themselves work on side projects or their startups or maybe even buy a motorcycle and take a trip around the country (barring covid). Such lives are pretty much impossible in Canada, even for a developer.

This comment shows a fundamental lack of understanding of life in India.

And how would you come to that conclusion?

By your logic, no place has an understanding of life.

Would you rather not call it "my understanding of life"?

Or was that implied? If so, please expand on that.

I agree with you 100%. QoL in India and Canada aren't even close to being comparable, it's like weighing a cruise liner and a paper boat on the same kitchen scale. It only takes a short visit to Indian news sites to see the true state of things. (Example: https://www.newindianexpress.com/nation/2020/oct/27/dalit-yo...)

The other child comments on your comment seem incoherent. I wonder what's up with that.

But the rate of that is slowing is what is likely happening. Compared with low cost of operating in the third world, more ideas are viable than would be viable in the US, because of grossly higher costs in the US.

You're right that a lot of talented people immigrate to the US, (and emigrate from India in general), but India is very populous.

The number of talented Indians who don't leave their country must be many times higher.

Not to mention the fact that a student who didn't prepare/cram for their life in/after class 10+2 to get into IIT/NIT/IIIT is a substandard engineer; not at all. That's just engineering I've mentioned. There are lots of them.

There are literally millions who are in India and would probably stay in India who are really capable. Of course there are millions who are not.

Considering the number of outsourcing companies in India, I believe we are very far from reaching the peak of product based India.

There are signs that India's early consumer/b2b startup ecosystem is heating up like China's. I am not sure the YC playbook of Team, Idea, Product and Execution work too well at this stage - in fact it might put startups at a disadvantage if they're too focused on processes early on, it just slows you down.

If your idea gains traction, you can expect multiple competitors in your space in a matter of weeks, nearly identical perhaps. This has happened for video conferencing software, recruitment software, shopify-like website builders and more. In such situations, it might be worth learning how successful Chinese startups set themselves apart from the pack.

Your submission is a dupe.

https://news.ycombinator.com/item?id=24884059

The submission is in fact a duplicate, check the source I added. You could just acknowledge it at the very least or ignore it but downvoting for no apparent reason isn't the best way.

Reply on news.ycombinator.com